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Israel at ‘Full Employment,’ Figures Show

By Dror Halavy

Friday, March 17, 2017 at 4:59 am | י"ט אדר תשע"ז

(AP Photo/Wilfredo Lee, File)

YERUSHALAYIM - Positive economic news for the Israeli economy continued in February. Unemployment fell 0.8 percent during the month, with 168,800 people seeking work at government-sponsored employment offices, 1.200 fewer than a month earlier. The unemployment rate is now around 4 percent – lower than it has been in more than a decade, and is considered by economists to be at the level of full employment, where there is no cyclical or deficient-demand unemployment.

Fewer people left their jobs or were fired. A total of 18,400 people fell into those categories in February, 1.4 percent fewer than in January. There were fewer unemployed among both college and non-college graduate employees, with the latter falling 0.9 percent from January levels, and the former falling 0.3 percent.

According to Boaz Hirsch, director general of the Employment Service, “the strong labor market is reflected in the smaller numbers of people who seek work each month. We see the strong demand for workers as an opportunity, and we are using it to encourage employment among many different populations.”

Meanwhile, prices remained stable in Israel in February, with zero inflation recorded for the month, the Central Bureau of Statistics (CBS) reported. Based on the behavior of prices over the last 12 months, the inflation rate in Israel for the coming year will be 0.4 percent. That would actually be a significant change; in 2016, the inflation rate was negative 0.2 percent, the third year in a row that prices officially went down. The biggest contributors to the fall in prices in February was in clothing, prices for which fell 5.3 percent in February over the month before, and in communications services, which were 1.6 percent cheaper during the month compared to January.

It should be noted, however, that those figures concerned prices consumers paid for goods and services – and did not include real estate costs. Those continued their near-inexorable rise, with housing prices rising 0.5 percent in February over the January levels, according to the CBS. Rents rose 1.7 percent during the month as well.